TaxTMI 
TaxTMI 
TaxTMI 
2017 (10) TMI 931
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....s. The assessee has also shown loss of Rs. 43,34,872 from commodity trading. The income from the business and profession was finally declared at a loss of Rs. 2,08,87,278. The assessee has also shown long term capital gains of Rs. 3,66,69,217 from sale of a property. 3.1. The A.O. noted that assessee has claimed loss of Rs. 1,83,81,003 from equity share trading through M/s. Religare Securities Ltd., and another share trading loss of Rs. 34,29,057 from the equity share trading through M/s. Indiabulls Securities Ltd., The total share trading loss claimed by assessee as business loss is thus Rs. 2,18,10,060. The assessee has set-off this loss from the profit of his liquor business of Rs. 1.37 crores. The A.O. asked the assessee to prove business of share trading and as to why trading loss claimed by assessee, should not be treated as long term capital loss and thereby, set-off from business profit should not be disallowed. The assessee did not furnish reply, instead he submitted the copy of the ledger accounts of both the above parties viz., M/s. Religare Securities Ltd., and Indiabulls Securities Ltd., and submitted that there is loss in share trading. The assessee has been regularl....
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..... The A.O. noted that though the assessee claimed ownership of property for the purpose of claiming cost of acquisition but relevant documents have not been filed. Whatever material was produced before A.O. was considered in which certain discrepancies were found. In short, the A.O. noted that assessee has not been able to furnish the documents related to purchase of property at various stages. Therefore, even though the sale receipt of the assessee during the year is treated as the short term capital gain, the purchase cost claimed by the assessee is taken at NIL since it is not supported by any authentic document. The short term capital gain was, therefore, computed at Rs. 4,95,00,000 as against Rs. 3,66,69,217 shown by the assessee. 4. The assessee carried both the matters to the Ld. CIT(A) in appeal. The assessee moved application under Rule 46A of the I.T. Rules, 1962 for admission of the additional evidences. The assessee in the application submitted that A.O. asked the assessee on 19th December, 2011 to furnish purchase documents of relevant property. The assessee could not collect the relevant papers for purchase of the property and thus, the A.O. without allowing any effe....
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.... in the light of Board circular and several decisions found that the assessee has intention to purchase the shares since beginning to do commercial transaction and to earn the profit. Therefore, the intention of the assessee was to do business activities. The sale of shares were effected subsequently for the purpose of making profits in short term. The assessee has treated the shares as stock-in-trade. The A.O. treated the income from transaction in shares in preceding A.Y. 2008-09 as business income on the identical facts. There is a volume, frequency, continuity and regularity of the transactions during the year under appeal. Thus, an inference can be drawn that activity is in the nature of business. The Ld. CIT(A) therefore, held that assessee's case is within the ambit of business income. The tests towards intention, frequency, ratio between purchase and sale and holdings, purchase and sales being towards realizing profits etc., are mostly in favour of the transactions being treated as business transactions and the income as business income. The cumulative effect of all the factors is thus, for treatment of the income from transactions in shares as business income. The A.O. in ....
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....t a conclusion that additional evidence was necessary for deciding the issue on hand. The Hon'ble High Court also observed in its Judgment that "It is well settled that the procedure is hand-mate of justice and justice should not be allowed to be choked only because of some inadvertent error or omission on the part of one of the parties to lead evidence at appropriate stage. Once it is found that the party intending to lead evidence before the Tribunal for the first time was prevented by sufficient cause to lead such evidence and that this evidence would have material bearing on the issue which needs to be decided by the Tribunal and the ends of justice demands admission of such evidence, the Tribunal can pass an order to that effect." 7.1. The Hon'ble Delhi High Court in the case of CIT vs. Virgin Securiteis and Credits P. Ltd., (2011) 332 ITR 396 (Del.) held that the additional evidence was crucial to the disposal of the appeal and had direct bearing on the quantum of the claim made by the assessee, Rule 46A of the I.T. Rules, 1962, permits the CIT(A) to admit additional evidence if he finds that the same is crucial for disposal of the appeal. Considering the facts of the case i....
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....it the additional evidence for the purpose of disposal of the appeal of assessee, with regard to computation of long term capital gains. Since these additional evidences have not been admitted by Ld. CIT(A) and A.O. has no occasion to examine the same in accordance with law, we are of the view that the entire matter of issue of long term capital gains and the claim of acquisition of indexed cost for long term capital gains, be restored to the file of the A.O. for deciding the issue afresh, in accordance with law. In view of the above discussion, we set aside the orders of the authorities below and restore the matter in issue to the file of the A.O. with a direction to re-decide the issue of long term capital gains in accordance with law in the light of additional evidences so admitted above. The assessee is directed to file copies of these additional evidence before A.O. for disposal. The A.O. shall give reasonable, sufficient opportunity of being heard to the assessee. Both the grounds of appeal of assessee are allowed for statistical purposes. 8. In the result, ITA.No.5760/Del./2014 of the assessee is allowed for statistical purposes. ITA.No.5978/Del./2014 - A.Y. 2009-2010. 9....